Abu Dhabi National Hotels: What Went Wrong? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Abu Dhabi National Hotels: What Went Wrong?
In 2012, Abu Dhabi National Hotels had been struggling and the performance of the company had significantly declined, especially that of its main hotel business. Net profit had been decreasing since 2009 and, with this shrinking profitability, shareholders were losing confidence in the company. The share price of the company had also deteriorated and was expected to decline further. With the drop in net profit year after year, investors were very concerned about the company's performance and the direction of its future growth. The company had five business segments - hotels, retail services, catering, transportation and holding - and a deep analysis of the company's performance areas and plan to improve these were needed.
Swot Analysis of "Abu Dhabi National Hotels: What Went Wrong?" written by Anupam Mehta includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hotels Dhabi facing as an external strategic factors. Some of the topics covered in Abu Dhabi National Hotels: What Went Wrong? case study are - Strategic Management Strategies, Performance measurement and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Abu Dhabi National Hotels: What Went Wrong? casestudy better are - – increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, there is increasing trade war between United States & China, geopolitical disruptions,
there is backlash against globalization, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Abu Dhabi National Hotels: What Went Wrong?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Abu Dhabi National Hotels: What Went Wrong? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hotels Dhabi, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hotels Dhabi operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Abu Dhabi National Hotels: What Went Wrong? can be done for the following purposes –
1. Strategic planning using facts provided in Abu Dhabi National Hotels: What Went Wrong? case study
2. Improving business portfolio management of Hotels Dhabi
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hotels Dhabi
Strengths Abu Dhabi National Hotels: What Went Wrong? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hotels Dhabi in Abu Dhabi National Hotels: What Went Wrong? Harvard Business Review case study are -
Sustainable margins compare to other players in Finance & Accounting industry
– Abu Dhabi National Hotels: What Went Wrong? firm has clearly differentiated products in the market place. This has enabled Hotels Dhabi to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Hotels Dhabi to invest into research and development (R&D) and innovation.
Learning organization
- Hotels Dhabi is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Hotels Dhabi is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Abu Dhabi National Hotels: What Went Wrong? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Hotels Dhabi are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Superior customer experience
– The customer experience strategy of Hotels Dhabi in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Hotels Dhabi has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Abu Dhabi National Hotels: What Went Wrong? Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Analytics focus
– Hotels Dhabi is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Anupam Mehta can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Ability to lead change in Finance & Accounting field
– Hotels Dhabi is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Hotels Dhabi in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Hotels Dhabi has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hotels Dhabi to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Hotels Dhabi is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Abu Dhabi National Hotels: What Went Wrong? Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Innovation driven organization
– Hotels Dhabi is one of the most innovative firm in sector. Manager in Abu Dhabi National Hotels: What Went Wrong? Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Hotels Dhabi has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hotels Dhabi has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Weaknesses Abu Dhabi National Hotels: What Went Wrong? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Abu Dhabi National Hotels: What Went Wrong? are -
Workers concerns about automation
– As automation is fast increasing in the segment, Hotels Dhabi needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
No frontier risks strategy
– After analyzing the HBR case study Abu Dhabi National Hotels: What Went Wrong?, it seems that company is thinking about the frontier risks that can impact Finance & Accounting strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Abu Dhabi National Hotels: What Went Wrong?, is just above the industry average. Hotels Dhabi needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow decision making process
– As mentioned earlier in the report, Hotels Dhabi has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Hotels Dhabi even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Abu Dhabi National Hotels: What Went Wrong? HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Hotels Dhabi has relatively successful track record of launching new products.
Lack of clear differentiation of Hotels Dhabi products
– To increase the profitability and margins on the products, Hotels Dhabi needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hotels Dhabi is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Abu Dhabi National Hotels: What Went Wrong? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Abu Dhabi National Hotels: What Went Wrong?, it seems that the employees of Hotels Dhabi don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High bargaining power of channel partners
– Because of the regulatory requirements, Anupam Mehta suggests that, Hotels Dhabi is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Products dominated business model
– Even though Hotels Dhabi has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Abu Dhabi National Hotels: What Went Wrong? should strive to include more intangible value offerings along with its core products and services.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Hotels Dhabi supply chain. Even after few cautionary changes mentioned in the HBR case study - Abu Dhabi National Hotels: What Went Wrong?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hotels Dhabi vulnerable to further global disruptions in South East Asia.
Opportunities Abu Dhabi National Hotels: What Went Wrong? | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Abu Dhabi National Hotels: What Went Wrong? are -
Building a culture of innovation
– managers at Hotels Dhabi can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hotels Dhabi is facing challenges because of the dominance of functional experts in the organization. Abu Dhabi National Hotels: What Went Wrong? case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Hotels Dhabi to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hotels Dhabi can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Hotels Dhabi in the consumer business. Now Hotels Dhabi can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hotels Dhabi can use these opportunities to build new business models that can help the communities that Hotels Dhabi operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Buying journey improvements
– Hotels Dhabi can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Abu Dhabi National Hotels: What Went Wrong? suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Hotels Dhabi can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Hotels Dhabi can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hotels Dhabi in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hotels Dhabi can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Hotels Dhabi can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Developing new processes and practices
– Hotels Dhabi can develop new processes and procedures in Finance & Accounting industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Better consumer reach
– The expansion of the 5G network will help Hotels Dhabi to increase its market reach. Hotels Dhabi will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Threats Abu Dhabi National Hotels: What Went Wrong? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Abu Dhabi National Hotels: What Went Wrong? are -
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Hotels Dhabi.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hotels Dhabi can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Hotels Dhabi has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Hotels Dhabi needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High dependence on third party suppliers
– Hotels Dhabi high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Increasing wage structure of Hotels Dhabi
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Hotels Dhabi.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Abu Dhabi National Hotels: What Went Wrong?, Hotels Dhabi may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Shortening product life cycle
– it is one of the major threat that Hotels Dhabi is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Hotels Dhabi in the Finance & Accounting sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Hotels Dhabi can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hotels Dhabi in the Finance & Accounting industry. The Finance & Accounting industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hotels Dhabi can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Abu Dhabi National Hotels: What Went Wrong? .
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Hotels Dhabi needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Abu Dhabi National Hotels: What Went Wrong? Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Abu Dhabi National Hotels: What Went Wrong? needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Abu Dhabi National Hotels: What Went Wrong? is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Abu Dhabi National Hotels: What Went Wrong? is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Abu Dhabi National Hotels: What Went Wrong? is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Hotels Dhabi needs to make to build a sustainable competitive advantage.
